Selangor MB Azmin Ali says the deal is off because Putrajaya didn’t adhere to contract

The multi-billion ringgit water restructuring deal between the Selangor state government and the federal government fell through because the latter refused to honour crucial parts of the agreement signed on September 12 last year.

Mentri Besar Azmin Ali told reporters at Parliament today that the federal government wanted free land where the water pipes were located.

The Malaysian Insider reported that Azmin said the land was not part of the agreement signed between the state government and the Barisan Nasional federal government on September 12, 2014. The 26,000km of pipes are among the assets listed in the agreement.

“The failure to continue with the master agreement was due to the federal government’s refusal to respect the main agreement signed last September.

“They want the land for free, the land does not belong to them. What was stated in the agreement and agreed upon by both sides was to handover the assets owned by the concessionaires,” he was quoted.

He further said that if Selangor were to agree with the contract, it would lose sovereignty over state land.

In a press statement which was sent a while after the press conference, Azmin added that the reasons for the collapsed deal was because the BN government failed to:

>> Acknowledge the ownership of state assets worth RM14.9 billion which is about to be pumped in to Pengurusan Air Selangor Bhd.

>> Acknowledge and accept the transfer of RM2 billion worth of Air Selangor’s assets for the purpose of funding Air Selangor to takeover all water concessions in Selangor

>> Issue a Facilities License to Air Selangor as confirmation of the asset ownership of Air Selangor

>> Sign the Hire Purchase agreement between Pengurusan Aset Air Berhad and Air Selangor

The water restructuring exercise was mooted under former Mentri Besar Khalid Ibrahim last September in an attempt to resolve water woes in Selangor.

The state, in March and April last year, suffered a massive water shortage which led to a water rationing exercise that affected millions of people. Since then, water cuts and shortages have occurred on an alarmingly frequent basis, mostly due to water treatment plant failure or pollution.

The deal was supposed to return the rights to managing water to the state instead of the current four concessionaires: Syarikat Bekalan Air Selangor Sdn Bhd (Syabas), Puncak Niaga Sdn Bhd (Puncak Niaga), Konsortium Abbas Sdn Bhd (Abbas) and Syarikat Pengeluar Air Selangor Sdn Bhd (Splash).

“When I took over the position from (Khalid), I said that my administration would be ready to honour the agreements signed. However, the deal cannot be implemented when it goes against the principles agreed upon,” Azmin added.

When contacted by the Malaysian Insider, Energy, Green Technology and Water Minister Maximus Ongkili denied that they had reneged on the deal.